What does your current financial consolidation process look like? Are you and your employees calm and collected, or are people frantically rushing to close the books before the end of the quarter or year? If you fall into the latter category, don’t worry – it doesn’t have to be that way.
Putting a strategy in place makes the financial close process much smoother and efficient, regardless of whether it’s year-end close or quarterly close. ERP integration is a vital component of this strategy. Read on to learn how automating the financial reconciliation process streamlines it as well as ensures that you’re compliant with any relevant regulations.
The Issues that Plague Your Current Financial Consolidation Process
If you’ve ever wondered why ERP integration is a good idea, take a second to think about your current financial close process.
Maybe your company doesn’t have direct ERP integration to your financial reporting software. In that case, you’re using spreadsheets. And those spreadsheets are most likely rife with errors – a British consulting firm reported that 90% of all spreadsheets it audited with more than 150 rows contained mistakes.
The article, "The Top Five Dangers of Using Spreadsheets" explores the following spreadsheet issues:
- Multiple spreadsheets can create data conflicts
- Spreadsheets are time-consuming
- Data errors in spreadsheets often go unnoticed until a problem is noted
- Spreadsheets slow down processes
- There's a lack of control with spreadsheets
Consider this scenario: Your company has a variety of disparate systems, and none of them talk to one another. Collecting the data from each department is a time-consuming and tedious task. Moreover, the chance of errors can also be high; if the information isn’t up to date, you can’t close the books until you’ve got the right numbers.
How Does ERP Integration Lead to a Smoother Financial Consolidation Process?
Your ERP system is a valuable repository of financial information. When that repository is integrated into financial performance management solutions, you have access to the latest data. That means that you can make better decisions about your firm’s future.
Technology analysts advocate automation – not just because they’ll keep their jobs, but because it’s a genuinely better way to carry out processes. For the financial consolidation process, your financial data is automatically drawn from your ERP system and drawn into your reports. This saves you time; you’re no longer hunting for data throughout the company.
There’s another reason that ERP integration is a good idea: it keeps you in compliance with government regulations. You’re expected to provide accurate and honest financial reports. When data is being automatically drawn from a central repository, there isn’t a risk of errors due to things such as manual data entry.
If you don’t have a strategy (and especially not a strategy that includes ERP integration) for your financial consolidation, it’s not too late to change the way you’re doing things and make the financial close process smoother and more efficient. Automation saves you time, money, and aggravation by giving you the most up-to-date information instantly. To learn gain more valuable insights and best practices for financial close and consolidation, access the Bloor Report below.